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11/23/2018

Will My Medicare Premiums Go Up Next Year?

“A new surcharge tier will kick in for 2019 for people with the highest incomes.”

The Centers for Medicare & Medicaid Services has recently announced that most seniors will pay $135.50 per month for Medicare Part B in 2019. That’s a bit of a nudge up from $134 per month in 2018.

Kiplinger’s recent article, “What You'll Pay for Medicare Premiums in 2019,” reports that a few Medicare beneficiaries (about 3.5%) will pay somewhat less because the cost-of-living increase in their Social Security benefits isn’t big enough to cover the full premium increase. The “hold-harmless provision” keeps enrollees’ annual increases in Medicare premiums from rising above their cost-of-living increases in Social Security benefits, if their premiums are automatically deducted from their Social Security payments. Social Security benefits are increasing by 2.8% in 2019, which will cover the increase in premiums for most seniors.

Premium increases are also pretty slight for most higher-income beneficiaries. Who are they? Those with adjusted gross income plus tax-exempt interest income of more than $85,000, if single or $170,000, if married filing jointly. These people already pay a high-income surcharge. However, a new surcharge tier will apply in 2019 for people with the highest incomes. Thus, monthly premiums for higher-income beneficiaries will be between $189.60 to $460.50 per person, based on their income.

If your income is $85,001 to $107,000 (or $170,001 to $214,000 if filing jointly), your monthly premium will go from $187.50 to $189.60. Monthly premiums for singles with an income of $107,001 to $133,500 (joint filers with income of $214,001 to $267,000) will be $270.90 (that’s up from $267.90). Premiums for singles earning $133,501 to $160,000 ($267,001 to $320,000 for joint filers) will increase from $348.30 to $352.20.

If your income was greater than that, your monthly premium for 2018 was $428.60. In 2019, again, there’ll be an extra surcharge tier for people with the highest income. These high-income surcharges for 2019, are typically based on 2017 income. You can contest the surcharge, if you’ve had life-changing events that may have dropped your income since then. This includes retirement, divorce or the death of a spouse.

If your income is in the range of $160,001 to $499,999 ($320,001 to $749,999 for joint filers), you’ll pay $433.40 per month. Single filers with income of $500,000 or more ($750,000 or more for joint filers) will pay $460.50 per month.

Deductibles will also go up in 2019: the deductible for Medicare Part A, which covers hospital services, will increase from $1,340 in 2018 to $1,364 in 2019. The deductible for Medicare Part B, which covers physician services and other outpatient services, will see a small increase from $183 to $185.